The way we are worried about our #CreditScores, similarly #SocialScore and in society #GoodwillScore works in rural areas. What mental score their society gives them is more important than credit score by bureaus.

They may not be aware of the fact that loan default may mess up with their credit score but for sure are aware that it will damage their social score and hence a repeat loan will be an issue.
This Customer segment is always in need of money so these parameters matter more for them and is also a reason to repay promptly.

And we always think that only a #Formal system can keep things in line. Apart from formal parameters, there are lot of social parameters as well in #Lending, we need to keep both handy for evaluation and #Underwriting.

How would you define the Social and GoodWill scores which exists for this segment?

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To address the basics and specifics, how does Rural based lending scoring work in first place? Aside from what I understand is that TransUnion CIBIL has a product called as New To Credit (NTC) which helps mostly the urban and semi urban uninitiated consumers to be formally engaged in the credit system. How do Rural Banks, MFIs, Banks indulging primarily in finclusion at village and gram panchayat level, ascertain the credit worthiness of a borrower/set of borrowers given the lack of quantifiable digital data?

Similarly what is the exact definition of Social Score and Goodwill Score – their parameters/metrics if any? Is it solely applicable for Tier 2/3 and below regions OR can it/is it being used here in Tier 1 cities where I personally feel it may meet with greater usage and application

For Social Scores – before we begin to ascertaining a set template, key gut feeling is that every region/village may have diverse different characteristics – hence a uniform social scoring approach, may not be the best way/right way? Aside from this however common aspects like – family size, current borrowings from zamindar, land in possession/in mortage, number of years principal and outstanding interest, income from farming or any other small scale activity, share of middlemen in the crop/agriculture business — just a thought?